Texas Rangers Bankruptcy Sale Runs Into Problems
The Texas Rangers of Major League Baseball were put into bankruptcy as a leveraged action to spur a quick sale. That goal has run of the tracks with the judge not going for the plan.
The Texas Rangers are currently owned by a company controlled by Tom Hicks. Mr. Hicks has major money problems and is trying to sell the Rangers among other sports assets. He has a buyer in a group headed by Hall of Fame pitcher Nolan Ryan. The problem is the lenders for the team believe there are better offers available and want the court to have an auction to generate the most money.
The Rangers bankruptcy raises a typical fight that occurs in these types of matters. The creditors want to maximize the money available to pay the debts in question. The filing company, however, often wants to expedite things as quickly as possible. Throw in the fact this is a professional sports team and you have additional issues related to league approval of the ownership group as we saw with the Phoenix Coyotes in the NHL.
So, what is going to happen with the Rangers? The answer is unclear. The bankruptcy judge ordered the new restructuring head of the bankruptcy estate to come up with a new plan. The judge failed, however, to incorporate what exactly needs to be changed regarding the plan. Should an auction be done? Should other debts be repositioned? Nobody really knows.
The ambiguity of the ruling by the judge is not a mistake. It is undoubtedly intentional. Why would a judge do this? He is most likely trying to get the parties to come to the bargaining table so they can negotiate a new deal that everyone can live with. Whether that actually happens, of course, is something only time will tell.